A written succession plan is essential in planning for the future of your business.

Business Transition Planning

Business transition is the process of moving an organization into a new generation of leadership and ownership. It is often difficult for entrepreneurs to give up ownership and control of a business they have built over many years of hard work. However, it is clear that a transition will come. The causes of the transition are many:

Death
Retirement
Illness or disability
Divorce
Bankruptcy
Mental illness
Changes in lifestyle or goals
Irreconcilable business differences

The important part is whether the owners, the company and the successors have planned for that transition.

One of the biggest barriers to planning a business transition is the belief that when we are ready someone will appear at the door ready, willing and able to pay a fair price for the company. Unfortunately this rarely happens. Studies show that only about 21% of family owned companies make the transition to the second generation, whether it is to family or to others. As we know: No one plans to fail they just fail to plan. Long term planning is too easy to put off. Often it is further complicated by the different goals and objectives of multiple owners.

The steps in transition planning are fairly straight forward:

Identify those who will be the successors
Arrange it so that the successors will be around for the long term
Put a written succession plan in place
Fund the transition plan
Prepare the successors and the company for the transition
Leave the premises!

Our firm is prepared to assist clients in the planning and execution of a successful transition through:

Consultation and advice on the process
Assessment of the best methods for making the transition
Negotiation and preparation of Buy-Sell Agreements
Formation of partnerships to help fund transition

If you or your business needs more information or assistance with business transition planning, please contact Marlowe McNabb, P.A.